Dow Seadrift Operations, Dow Chemical see slow but steady improvement

By
ALLISON MILES
April 20, 2010 at 4:01 p.m.Updated April 20, 2010 at 11:21 p.m.

After a rocky 2009, business is improving for Dow Chemical and its Seadrift Operations, a company official said Tuesday.

Brad Fedorchak, Seadrift's site leader, spoke to about 70 people at the Victoria Economic Development Corp.'s Victoria Partnership meeting. He updated the group on Dow Chemical and conditions at the local plant.

Last year, Seadrift's Nordel MG Hydrocarbon Rubber unit closed, taking with it about 100 jobs, he said. Some of those employees retired; the company let go of others.

"It was a tough year for the folks in manufacturing in Seadrift," Fedorchak said, explaining the site is now decommissioning and demolishing the rubber plant. "It was very difficult shutting down one of the facilities on site."

The year 2009 was difficult company-wide, he said.

Dow Chemical announced a joint venture with Kuwait Petroleum, but the deal fell through, he said. At the same time, the company had plans to acquire Rohm and Haas.

"We were left here just purchasing Rohm and Haas, with no cash to pay about a $16 billion bill," he said. "So, the company was in a very, very dire straits."

In recent months, the company restructured its debt and sold off multiple businesses, he said. With the money that generated, combined with earnings and savings from the Rohm and Haas acquisition, the company has a decent debt-equity ratio.

The company's stock is valued at about $30 a share. Although that price isn't ideal, the stock rebounded from the $6-per-share it fell to in 2009.

In Seadrift, the rebound is going well and morale is up, Fedorchak added.

The site will perform a shutdown in early May, he said, and will add 500 contractors for the month or so it will take to perform on-site maintenance.

One thing that remained steady was the plant's safety record. The national average is 4.2 injuries per 100 employees in a year, he said. Dow Chemical Co.'s rate is .29. Seadrift comes in lowest, with .16.

"We're very proud of our performance in Seadrift," he said. "We're very proud of our performance in Dow and we're very proud of how safe it is to work inside our fence line for our employees and our contractors and guests."

When the Seadrift site does well, it benefits Victoria, said Dale Fowler, president of the Victoria Economic Development Corp.

Dow likely affects six or seven cities across the region, he said, while Fedorchak added about 85 percent of employees live in Victoria County.

It won't happen overnight, Fedorchak said, but the company is slowly but surely approaching recovery.

"We plan on being here for a very long time, and we plan on being part of this community for a very long time," Fedorchak said.